Financing trends 2014 - ICA members

Infrastructure financing commitments by ICA members totalled $18.8bn in 2014, against a challenging regional and global background (including the Ebola crisis in West Africa). While at first glance this indicates a drop of 25% compared to the 2013 total of $25.3bn, it represents a small (3%) increase in ICA member commitments once the exceptional, one-off, pledge of $7bn from the US presidential Power Africa initiative is excluded.

Excluding the US Power Africa pledge, there was a substantial increase in commitments to the energy sector in 2014, to $9.2bn; this represents a 61% increase on the $5.7bn committed in 2013.

Commitments to the transport and water sectors fell, by around 30%. This decline was compensated, to some extent, by an increase in multi-sector commitments, which rose by 43% from $1.5bn in 2013 to $2.15bn in 2014.

Although disbursements have remained broadly constant for the past three years, there are some significant regional and sectoral variations. For example, substantially more funds were disbursed to West Africa across most sectors in 2014 compared with the previous year, while disbursements to Southern Africa’s transport sector and East and Southern Africa’s ICT sectors all declined.

Figure 28: ICA members' community by sector, 2014

Figure 29: ICA members' commitments by region, 2014

It is also important to recognise the financial contributions made by many bilateral ICA members to the multilateral development banks. For example, Canada, France, Germany, Japan, the UK and US contribute to the AfDB’s African Development Fund and the World Bank Group’s International Development Association.

ICA members also support DFIs through allocations not captured in ICA data, such as those made by CDC (formerly the Commonwealth Development Corporation). According to CDC’s annual review, the wholly-UK government-owned and financed institution made commitments to Africa of $240.9m in 2014, of which $100.6m was targeted on the energy sector either through direct investments or via funds.

Conventional financing instruments remain the most frequently used by ICA members. Of the $18.8bn committed in 2014, loans accounted for 75% and grants for 14% of financing. Blended funding accounted for 7% of commitments, while guarantees and insurance accounted for 2%. The remaining 2% was financed through equity investment and other forms of financing.